W2 Canola/Rapeseed Update: EU Witnesses Robust Rapeseed Processing in Q4-23, Ukraine Achieved Sixfold Surge in Rapeseed Oil Exports in 2023

EU Rapeseed Processing Hits 6.38 MMT in Q4-23, Near Record Levels

In Q4-23, rapeseed processing in the European Union (EU) reached 6.38 million metric tons (mmt), nearly matching the record figures from the same period in the previous year, which stood at 6.41 mmt, according to the Oil World estimates. The most significant increases in rapeseed processing were observed in Germany by 0.8 mmt, the Netherlands by 0.2 mmt, the Czech Republic by 0.2 mmt, and Poland and France by 0.1 mmt each.

Ukraine's Rapeseed Oil Exports Soared Six-fold in the First Half of 2023/24 Season

In the first half of the 2023/24 marketing year (July-December), Ukraine witnessed a substantial increase in rapeseed oil exports, reaching 356 thousand metric tons (mt), a nearly six-fold rise compared to the same period in the 2022/23 MY. This figure set a record for the first half of the 2023/24 MY and the entire season. The surge in export pace and volume is due to strong global demand for rapeseed oil at attractive prices. Difficulties in sunflower purchase during the off-season further incentivized Ukrainian factories to enhance rapeseed processing. The majority of Ukrainian rapeseed oil shipments during the first six months of the 2023/24 MY were directed to EU countries (54%) and China (31%).

Tomsk Region's Oil and Fat Exports Surged in 2023, Led by Rapeseed Oil

In Russia's Tomsk region, oil and fat product exports totaled USD 47.79 million in 2023, a 1.4-fold increase from the previous year. Within this category, the export of rapeseed oil increased significantly from USD 32.3 to USD 40.9 million, constituting 41.8% of all exports from the Tomsk agro-industrial complex.

Canola Cultivation in Paraguay Surged 18% YoY in 2023, Reaching Historical Highs

The latest data from the Institute of Agricultural Biotechnology (Inbio) indicates a notable 18% year-on-year (YoY) rebound in canola cultivation in nine departments of the Eastern Region in Paraguay, representing an increase of about 13,805 hectares (ha) compared to 2022. The canola area reached historical parameters, expanding from 78,189 to 91,993 ha, marking the best result in the last five harvests. The level of adoption approached the 2017 record when 106,277 ha were planted. This resurgence in canola cultivation is attributed to its popularity as a primary income source for many producers during the winter, with cultivation spanning departments including Alto Paraná, Itapúa, Caaguazú, Canindeyú, Caazapá, Amambay, San Pedro, Misiones, and Guairá.

Australian Canola Processing Industry Sees Increased Investment Amid Growing Demand

The demand for renewable fuels and changing dietary preferences in Southeast Asia have spurred increased investment in Australia's canola processing industry. Currently, Australia's canola processing capacity is relatively small, estimated at 1.2 mmt per year by the United States Department of Agriculture (USDA). In contrast, global canola processing capacity is expected to reach 81.1 mmt in 2023/24 MY. Over the past 25 years, Australian canola production has significantly grown from 2.5 mmt in 1999 to a record 8.3 mmt in 2023. Canada, a major competitor, harvested 18.17 mmt of rapeseed crop in 2022, with processing volumes reaching 9.96 mmt in the 2022/23 MY.